Daily Report – Bitcoin and Market Update (November 8 2021
The weekly candle closed with a new ATH. Yet another proof for the underlying bitcoin’s strength both on the technical side and the onchain side I’d referred to over the last few days. After a clean triangle pattern breakout BTCUSD showed, the price seems to be getting ready for $70,000 and $80,000 levels. The triangle breakout alone targets a distance equal to the base size ($36,000) added on top of the breakout level ($53,000) within the area of $85,000-$90,000.
50-week average has worked with 100% accuracy according to my expectations from June/July. Remember me saying that it would be the last buying opportunity of this kind in this bull run? Well, that’s nothing but proven correct – first at $29.6k, then at $40k. I highly encourage everybody to not trust but rather verify and let my past works speak for themselves for the accuracy. Because of that I’m completely unbothered by tertiary fluctuations and minor trading noise intraday. I’m relying on my own exit strategy and it’s coming true step by step and month by month.
Fibonacci based wave 3 extensions show off key resistances at $89,364 (aligns with triangle breakout target), $127,053 and $188,038. I find all of them likely to be hit in the next weeks-months. Will the bull market end this December? Well, I don’t have a crystal ball so I have no idea. All I know is that you don’t argue with the vertical trends of bitcoin when the largest corporations, banking institutions, mainstream whales and retail investors are all flooding and FOMOing in. You might have made a lot of dumb mistakes but fading the upcoming breakouts will be the dumbest of them all.
For reference, here’s a tweet and bitcoin report I made in July predicting Q3 consolidation in a symmetric triangle with a breakout in November for the ultimate rally.
The daily chart is an absolute strength from bitcoin. Pennant pattern has had its proper upside breakout as expected. Pennant breakout level at 63.3k combined with BB breakout level at 65k result in BTCUSD having targets first at ~$72,200 and anywhere between $85,000 and $90,000. The significance of today’s breakout is invaluable from the technical point of view. The technical strength is unquestionable and pointing directly at high 80k region. I’m as sure of it as I was when calling bitcoin’s reversal at 29.6k bottom.
If bitcoin closes the day over 65k today, it will be official volatility breakout and final confirmation for the numbers mentioned above.
Of course, in finance it is better to be safe than sorry always so in case of unpredicted FUD news, military conflicts emerging, world war starting to ignite somewhere, FED’s taxation FUD, expect mid $58,000 to work as a support in case of a local swing failure on the upside. It’s as unlikely as it can get, but nobody can guarantee the human kind wakes up tomorrow at all in case there’s e.g. planetoid rushing to crash into earth. It’s all about probabilities.
Also, 20-day average (the black curve) is starting to ascend again after a flat moment. It’s a signal of bitcoin’s technical strength. Just another confirmation in the complete puzzle and for the collection.
The middaily chart is showing a couple of key levels defined by volume trends and price. AVWAP trendlines analysis shows off that the entire correction from 65k to 28k is just a history and it’s completely neutralized right now. The volume weighted average price trendline shows that the long term trend anchored at 65k old ATH is ascending again. The correction was just an over extended correction, just like I said in June. The majority expected bear market and $5,000 targets for 80 day plus period. They were wrong badly.
The fair price of bitcoin based on the volume-based trendlines of different time scopes is as given below:
- 65k old ATH aVWAP – $45,000
- 29.2k July aVWAP – $48,565
- 40k September aVWAP – $58,251
- 57k October’s dip aVWAP – $62,138
Those levels should work as supports in case of unpredicted FUD news/events of low-to-high timeframes accordingly. As unlikely as it gets, it’s worth not taking anything for granted and keeping them on your charts as reminders for the upcoming bear market and that unrealized profits are no profits.
Below, let me bring again the “roadmap” for the next months:
1) $BTC ATH in hours – check.
2) Institutional + retails FOMO – processing.
3) Tech giants->crypto payments – processing.
4) #Bitcoin pulls 150-200k peak
5) BTC reversal day 40-50k drop
6) Ultimate altseason
7) Bear market 2022
8) BTC bottom $10-20k (85% decline, MA200 1W) Dec 2022
MTF chart shows BTCUSD attempting a breakout through the range highs. The range bound between 57k and 67k gives the base size of 10k so adding the base size on top of a breakout level of 67k results in clean target of 77k USD following a breakout, breakout retest and thrusting.
Closing a day or a week through 67k or better through 70k gives unquestionable breakout signal upon which a lot of retail longs are expected to pile up aggressively.
Volume profile analysis shows that 61000s have worked out well as a demand block inside the range. Current leg up past the weekly close shows off very significant volume behind 65-66k levels. It’s supportive of the thesis for an upside breakout over 70k.
Failed breakout on top could result in retesting the range lows of 57k in case of unpredicted FUD from the external factors outside the market alone. Although, it’s heavily unexpected.
Moving averages analysis shows MA50 to have started ascending again and now seems to align directionally to the upside. MA200 combined with MA50 are showing strong support inside 60.3-62.2k block. Rising MA200 is unquestionable upwards trend confirmation. It’s impossible to argue that. It’s just going up.
Let me quote back what my hourly chart analysis said on the last Saturday:
“Hourly chart represents typical sideways movement where head and shoulders pattern occurred to be fake/failed as it most often does for bitcoin. In my trading career I’ve found H&S patterns to more often fail than unfold in the expected direction.
The range continues between the boundaries and demand zone 58.5-60k and supply zone 66-67k.
As long as it trades within those boundaries, BTCUSD is NOT trending hence its neither bullish nor bearish. It’s just neutral and as always, one may apply one of the trading strategies for the ranges:
- Inside range trading (buy range lows or sell range highs)
- Outside range trading (buy the breakout retest or sell the breakdown retest
- Do not trade the range at all and wait for the trend to come up.
I don’t really have much to update here as current bitcoin’s chart is just a visualization and evidence behind my previous months’ thesis becoming real as we speak. Failed patterns tend to perform better in the opposite direction than the “default” given in the textbooks. Hence, BTCUSD pushing through and towards 77k will be yet another confirmation of this technical phenomenon.
Bitcoin: Net Unrealized Profit/Loss (NUPL)
I keep reminding what this onchain metric stands for for your own good. Here it is: “Net Unrealized Profit/Loss is the difference between Relative Unrealized Profit and Relative Unrealized Loss. This metric can also be calculated by subtracting realised cap from market cap, and dividing the result by the market cap.
Currently at 0.628 NUPL is nowhere near its top capacity of peaking ratios around 0.85. It’s showing belief stage of the market and I personally read it as underlying strength of bitcoin on the onchain side. The higher the ratio goes, the better take profit opportunity it becomes. And unrealized profit is no profit. Keep that in mind while growing in complacency and euphoria over the next few weeks.
More importantly, there are several reasons for what Im saying above to be true. Especially for the onchain strenght. Basically, the last week’s bullish onchain “divergence” has got even stronger. Not only current BTCUSD ATH levels come with way lower NUPL ratio (shows that market is healthier at the same ATH prices), but it also has just popped up a bullish “divergence” inside the larger said bullish “divergence”. Locally, the price of bitcoin is already testing recent highs of 66-67k and NUPL is 0.628 vs 0.658 at 67k. This shows the market is getting stronger and stronger on the lower timeframes as well. It’s bullish.
I’m starting to take profits more aggressively and intensify scaling out of the market once NUPL crosses over 0.75. I’d been mentioning that since June 2021 so it should not come out as surprise to anybody.
Bitcoin: Mean Hash Rate (168h Moving Average)
As glassnode says this onchain metric stands for the average estimated number of hashes per second produced by the miners in the network.
It’s yet another confirmation of the underlying onchain strength of BTCUSD which will lead the price upwards imo.
Hash rate advancing rapidly locally while the price hasn’t made new highs yet. It’s a strong trend that pushes bitcoin upwards fundamentally which is not yet reflected by the price. It’s almost a form of an onchain arbitrage.
Similar conclusions to NUPL: double bullish onchain “divergence”
FEAR & GREED INDEX
As expected few weeks ago, the market stays inside the extreme greed territory and instead of showing the weakness of the price trends, it’s an evidence of technical strength of the market. The crowds are always right in the middle of trend and always wrong at the extremes. Many people will mistakenly take it for an extreme case. But it’s wrong approach. As seen and confirmed by factors and context of TA, FA, intermarket analysis and onchain metrics, this extreme greed is now an evidence of strong upwards momentum which you don’t want to be fighting.
That’s the case where “the crowds are always right in the middle of trend” now. Besides, the final reminders start about our 14 Day Free Trading Congress which starts in 4 days. More than 12,000 participants have signed up in under 72 hours. The demand is record-breaking and FOMO is real about the congress. If you’re in for insane amount of free workshops, trading sessions, interviews, webinars, onchain masterclasses with literally the biggest legends of this industry with premium membership for free 14 days on top of that, then don’t wait and rush over immediately to sign up. Join with the link below before it starts.